How young Aussies could soon get a FREE $25,000 grant to help buy their first home as NSW government pushes to axe stamp duty
- NSW Government is planning to axe stamp duty and replace it with a land tax
- First-time homebuyers could get a $25,000 grant towards their purchase price
- Existing homeowners who paid stamp duty would not pay the new land tax
- Financial models predict it could see 300,000 new homeowners in the state
First time home buyers in New South Wales could get a $25,000 helping hand onto the property ladder under a proposal to axe stamp duty in the state.
Current stamp duty adds around $40,000 to the upfront costs of buying a $1,000,000 home in NSW before buyers even think about their deposit.
Under new proposals, the state is set to axe stamp duty and replace it with an annual land tax, while also offering new home buyers a $25,000 grant.
It’s predicted the move could help 300,000 more people buy their first home as a result and boost home ownership by six per cent.
First time home buyers in New South Wales could get a $25,000 helping hand onto the property ladder under a proposal to axe stamp duty in the state (picture posed by models)
NSW treasurer Dominic Perrottet revealed the proposal in a progress report on the state’s mission to finally axe stamp duty altogether.
The land tax would be based on an estimated land value of a home, with a property’s land valued at around $400,000 likely to pay $1617 a year under the new tax.
Owners who have already paid stamp duty would not be liable for the land tax under the plan.
Public consultations found support for the move to axe stamp duty but many were worried the land tax may soar in the future.
The current median house price in Sydney is $1.3million, a jump of 12.6 per cent in the last 12 months, with more and more now unable to get their foot on the ladder.
Current stamp duty adds around $40,000 to the upfront costs of buying a $1,000,000 home in NSW before buyers even think about their deposit (picture posed by models)
Stamp duty on a home at that price runs to $56,505, on top of a potential deposit of at least $130,000.
‘The first round of consultation and submissions showed 84 per cent of people believe stamp duty reform is needed,’ said Mr Perrottet.
‘Two thirds of the community said stamp duty was a significant barrier to home ownership. We will continue to listen to the community and invite further feedback.’
His department’s progress report added: ‘In the short term, the reform would reduce the NSW Government’s revenue.
NSW treasurer Dominic Perrottet (pictured) revealed the proposal in a progress report on the state’s mission to axe stamp duty. The current median home price in Sydney is now $1.3million, a jump of 12.6 per cent in the last 12 months, incurring stamp duty of $56,505
‘Over the longer-term, the property tax would be revenue neutral, collecting the same amount of revenue as stamp duty and land tax.’
Lobby group Committee for Sydney said they welcomed the proposal to axe the tax and open up the housing market to more young first-time buyers.
‘Our economy and people’s home buying patterns have changed dramatically since the tax was introduced to NSW in 1865,’ said chief executive Gabriel Metcalf .
‘As we come out of the pandemic, now is the time to reform and bounce back stronger as a state and nation.
‘Abolishing stamp duty on property purchases and replacing it with a broad-based annual land tax will be a key part of our bounce back.’
It’s predicted the move could help 300,000 more people get into their first home as a result and boost home ownership by six per cent